Solid year for farmers
By Steve Herring
Published in News on November 29, 2014 11:05 PM
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News-Argus/CASEY MOZINGO
Cotton bolls open as the plants mature to their peak in a field at the corner of New Hope Road and Cuyler Best Road earlier this fall. Farmers saw strong yields in corn, soybeans and cotton but made less money than hoped for as a result of depressed markets.
An overall good crop year in Wayne County was tempered somewhat by lower commodity prices, farm experts are saying.
And those depressed markets mean that growers had to make their yield in order to realize a return on their investments, said Tyler Whaley, field crop agent with the Wayne County Cooperative Extension Service office. Fortunately, the yields have been good for the most part, he said.
"Overall, it was a relatively good year," Whaley said. "Our soybean crop is good to excellent. We have a lot of good soybeans throughout the county, and the yield (50 to 60 bushels per acre) seems to be consistent. I have talked to some growers over the past few days and they said, 'I have never picked soybeans this good before.'
"Our corn crop was good. We got moisture at the right time during pollination and that helped the yield potential for corn. Our tobacco crop was hit and miss. We had some tobacco that was pretty good and had some that wasn't. That was due to excessive rainfall we had throughout the season. The one thing about tobacco was the quality was not good, especially on lower-stalk tobacco. This year, probably the biggest challenge our growers faced in terms of producing flue-cured tobacco was curing, especially those first primings were very difficult to cure."
A "big factor" in the corn and soybean market fluctuation is the crop in the Midwest, Whaley explained.
"They had pretty good yields, if not record yields out in the Midwest in corn and in soybeans," he said. "So that was bearish to the market.
"Also, with soybeans, you have to look at Brazil, Argentina. The South American crop, what it does has a big impact on the price for soybeans. But overall, price is down significantly for our commodities across the board. Looking back at 2012 we were looking at $7 or $8 (per bushel) corn and now we are hoping to get back to $4."
Soybeans right now are bringing just above $10 per bushel compared to just a year ago, when a bushel was demanding between $13 and $14.
"I think our yields are good enough that we will see some return on investment," Whaley said. "Overall, the crops were really good with the exception of some tobacco. The key this year for our growers is that we had to make yield. That was the name of game. We had to make yield to make up for the loss in price. I think that our growers, for the most part, did that."
It appears that the nearly completed cotton harvest is continuing that trend, even though there had been doubts early on about the harvest.
"The cotton crop has done a lot better, I think, than what we had at first anticipated it being," Whaley said. "It varies from farm to farm, but some of it was questionable back there in the summer. But it seems like as the year progressed, and we entered into harvest it, it really turned out to be pretty good for us."
Overall growers seem to be "pretty pleased" with the yields that they are getting, he said.
The reason for that difference between those early concerns and the final yield is the million dollar question, Whaley said.
"No. 1, I think it goes back to the growers," he said. "A lot of cotton growers know how to manage the crop. They know how to grow their crop, and they know how to grow it well. I think that has a lot to do with it.
"No. 2, I think the seed technology side of things, the seed varieties that have been developed are a lot better than what they used to be. So, I think it has to do with the farmer himself making the right management choices, and also the varieties have greatly improved."
The new varieties also have increased yield potentials over the years, he said.
"I am hearing consistently two-bale cotton (per acre)," Whaley said. "To put that in perspective, a bale of cotton is approximately 500 pounds. I am hearing two, two and a half, and a little bit of talk on three-bale cotton, but consistently I am hearing two-bale cotton. That is good for Wayne County.
"Cotton is cheap now. That is the negative side of the cotton market. It has been down for quite some time."
Many factors are at play for the lower price, but it really comes back to supply and demand, Whaley said.
Prices range from 60 to 65 cents per pound, down from several years ago when it was more than $1 a pound.
Farmers will turn some profit, but will need to make yield of two bales per acre to make money, Whaley said.
Texas, the Mississippi Delta, Georgia, and North Carolina are the leading cotton-producing states. Globally, China and India are the big players, Whaley said.
"With China being the main player, they have a significant impact on the volatility of the cotton market," Whaley said. "Currently they have over half of the total cotton supply in the world. A buildup of stocks results in market price trending downward -- what we are experiencing now.
"Our hope is demand for cotton will increase with time. It is very difficult to pencil out a profit on cotton at 60 cents per pound. The bottom line is that we have to make yield."
Agriculture is global, but it still goes back to supply and demand -- there is a lot of cotton in warehouses, he said.
Years ago when the price was higher, farmers planted more, but then the price came back down, Whaley said.
But everything is a cycle, he said.
Framers are in the process now of planting winter wheat.
"Typically we are a significant player in winter wheat production, but I think our acreage is going to be down somewhat this year," Whaley said. "That is obviously due to price, too. We had a lot of growers who seemed like they were on the fence back in October deciding if they wanted to plant or not.
"It seemed like to me that those who were kind of on the fence, they decided to go ahead and plant. So it is hard to determine how many acres we have right now because some is still being planted."
Still the county will have significant acreage, he said.
Whaley said he has no crystal ball when it comes to making a prediction for next year.
"We have been in this situation before with prices before, and we are going to plant what we have always planted when it is all said and done," he said. "But it is going to be a wait-and-see thing.
"Growers are really going to have to sharpen their pencils for this upcoming year in hopes of scratching out a profit."